Having signed Liverpool striker Fernando Torres for a fee rising to £50 million, Chelsea have also strengthened their defence with the acquisition of Luiz from the Portuguese club.

The transfer was first confirmed in a statement Benfica made to the stock exchange late on Monday night. Luiz has signed a contract that ties him to Chelsea until the summer of 2016 and joins for a fee of €25 million (£21.3 million), while young midfielder Nemanja Matic will also move to Estadio da Luz at the end of the season.

Luiz told the club's official website: "I am delighted to be joining a big English club, and I know very well the quality that Chelsea has. It is a major challenge for me but I am determined and confident in my ability to adapt to this excellent league, and I look forward to meeting my new team-mates."

Luiz, 23, was named Portugal's Player of the Year for 2010 as he helped Benfica win the domestic Double and has carved out a reputation as a defender of some repute since joining the club in 2007.

Chelsea chief executive Ron Gourlay said: "David Luiz is one of the great defensive prospects in world football, and already a Brazilian international. I am sure he will prove a valuable addition to the Chelsea squad."

Chairman Bruce Buck added: "It is a delight to have completed this transfer for a fantastic young footballer who we have admired for some time. David has played in the Champions League and the squad now has a more experienced look to it that will hopefully serve us well for the rest of this season and going forward."